IHTM20372 - Life Policies: life policy linked with an annuity: what to do first

You should follow these instructions if:

• the deceased effected a life policy, and
• an annuity was purchased at any time, and
• the benefit of the policy was vested in someone else.

This situation should be notified by the taxpayer on form IHT410 (IHTM20028) and form IHT403 (IHTM20044).

You will need to obtain the following documents if they have not already been provided

• full copies of

  • the life assurance and annuity policies (for example, schedules, provisions and trust of the life policy)
  • the application forms for those policies

• a letter from the insurance company which issued the life policy

  • saying what type of medical evidence it obtained (a medical attendant’s report or a report following a medical examination) before issuing the policy and stating whether any rating or mortality addition was applied on the basis of that evidence.
  • confirming that the life policy would have been issued on exactly the same terms had the annuity not been purchased (this means that the medical evidence was taken fully into account by the insurance company when the policy was written).

When you have all this information, you should refer the matter to the Actuarial Team, who will advise on what to do next (IHTM20373).